Why is gold so valuable ?

Big A.D. said:
Getting it out of the ground takes effort. If you weren't busy digging it out of the ground you could be doing something else, so the physical gold represents the effort that was expended finding it.
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So a proxy for proof of work... kinda like bitcoins? :D
 
jpanggy said:
Bernanke: "Tradition"
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Funnily enough, that's actually true.

It is and always has been money.

I imagine there is some interesting history surrounding gold.

Would be a good thing to make a documentary about.
 
would't you like to go back to 'mayans' time and ask them why do you like it so much? prior to the spaniards coming to america, the native indians ( latin america side i.e. aztecan, mayan civilizations) they had lots of it, maybe because it was so shiny and was superficial, but it was not a currency model -cocoa was- They created idols with it , indicating it was precious for them. make you wander, would you like to go back in time and look? :rolleyes: :rolleyes:
 
ummm lets see non rusting, rare, fungible, divisible, easily testable, shiny, portable, fairly indestructable.... nahhh TRADITION!
 
goldpelican said:
Big A.D. said:
Getting it out of the ground takes effort. If you weren't busy digging it out of the ground you could be doing something else, so the physical gold represents the effort that was expended finding it.
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So a proxy for proof of work... kinda like bitcoins? :D
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Here we go again Bit coins :o

I'm still sparing another member over this one :lol:

So what has Bit coins got to do with PM's??.and when can i advertise my Kawasaki 250 in the Sales forum ;)

REDBACK
 
plata said:
would't you like to go back to 'mayans' time and ask them why do you like it so much? prior to the spaniards coming to america, the native indians ( latin america side i.e. aztecan, mayan civilizations) they had lots of it, maybe because it was so shiny and was superficial, but it was not a currency model -cocoa was- They created idols with it , indicating it was precious for them. make you wander, would you like to go back in time and look? :rolleyes: :rolleyes:
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that would be awesome - i suspect the mayans would say it is commanded by their feathered serpent god Queztacoatl

interestingly in Bolivia there is evidence of Sumerian inspired cuneiform - that mesopotamian culture somehow crossed the great sea
 
Big A.D. said:
Getting it out of the ground takes effort. If you weren't busy digging it out of the ground you could be doing something else, so the physical gold represents the effort that was expended finding it.
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Before we start I woud like to inform Hi Ho that I am already on the gold train dammit!

That being said I am also confused as to any 'reason' for gold to be so valuable. I hear plenty of dogma but no resonable explanation.

The reason above is plausible of course but doesn't ring true. Most things take effort and if you weren't doing them you would be doing something else. I could get rock and some sandpaper and sand the rock down into rock powder, that took effort, I could have been doing something else with my time and the rock dust represents the effort that was expended to make it, but no one is going to give me $1800 an ounce for it. How is that different from digging up dirt from a hole in the ground? (rhetorical question)

The main reason I can come up with is to compare it with other stores of wealth, if you buy a ton of food it will be more useful than gold but will slowly deteriorate, a very poor store. Gold doesn't do that. Food spoils, gold doesn't, Food requires special storage and large areas, gold doesn't. As a store it is good, just not sure how that equates to value I am not sure.

Sure gold is pretty, many things are, butterflys and flowers spring to mind, so the idea that gold is used for jewellery is a possible reason but how many stackers (other then the pikies) have their stash as jewelery and not as bars or coins?

At the end of the day, I don't have to believe that it is a store of wealth, all I need is for you to believe that it is so when the time comes I have some one to buy the stuff off me so I can get my Yacht.
 
Jislizard said:
That being said I am also confused as to any 'reason' for gold to be so valuable. I hear plenty of dogma but no resonable explanation.
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Other have touched on this, but it comes down to the simple facts of rarity, recognition, acceptance, history.

(1) Gold is rare - not so rare as to be unavailable, but rare enough. With that rarity comes the expense of obtaining it - exploration, mining, purification. In gold's case, it's rarity in the earth, combined with these costs, makes it "sit pretty" in the global scheme of things to be a rare enough (but not too rare) metal to be considered a store of value. The same would be true of copper, were it as rare as gold.

(2) Recognition - gold is recognised the world over for the rare metal that it is, and moreover, we have developed methods of testing any given lump of metal to prove or disprove that it is gold.

(3) Acceptance/History - Given the combination of rarity, and the global recognition of gold, we today, as in thousands of years of history, accept that gold is a rare metal, and give it the worth it demands due to that rarity.

I do know what you're asking, though... you're effectively saying, in a sense, that the only reason "we" credit gold with the value that we do is because "everyone else" does as well... and in saying that, there is no technical or theoretical reason why tomorrow, for example, we don't all wake up, and choose to refute or disbelieve the value of gold - and that if enough people did so, then in theory, there is no basis for the high value of gold.

I have thought these same things before myself. And, technically, the above is true - there is nothing saying that gold *has* to have a high value. We, as society, choose to accept the fact that it does, and we place our faith in the rarity, cost-to-produce, acceptance, history and recognition of gold as a "store of value" so to speak.

However, one can compare this to the "rarity" <snigger>, recognition, acceptance and history of fiat currencies, who, in the same theoretical thinking space, require a level of faith to accept fiat as a "store of value" (interjectors who will raise inflation as an issue here are absolutely right, but please broaden the thinking for a moment and accept that I'm talking about a theoretical "moment in time" <grin>).

Herein lies the ultimate "test of faith" as it were... in a sense, we must give faith to the acceptance of fiat, as we do gold. But now, let's examine one fundamental that really does give gold it's true value: rarity.

Fiat currency, given value by decree, can also be manufactured, and done so in staggering amounts. Gold cannot, it must be discovered, mined and purified. And this can only be done in the amounts up to the amount we discover and are able to mine (about 2% increase per year).

This is the penultimate reason why gold is valued, treasured, and of high value.

(We could also begin to discuss Silver at this point, and whilst it is ten times more plentiful in the ground, there is still less of it available above ground, thus, it should commend a much higher price than it does... but that's a whole 'nother ballgame).
 
I found the book 'The Power of Gold' excellent. Goes into every aspect of history of gold.

If you have ever held a large gold nugget in your hand you will know why gold has been so sought after through the ages - it seems to possess some ancient mystical force which has a profound effect on the human mind so much so that people will kill for it! :P
 
goldpanner said:
I found the book 'The Power of Gold' excellent. Goes into every aspect of history of gold.

If you have ever held a large gold nugget in your hand you will know why gold has been so sought after through the ages - it seems to possess some ancient mystical force which has a profound effect on the human mind so much so that people will kill for it! :P
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thou art getting warmer ....
 
If you have/are privy to the method, you can burn it and grind it up into a powder, it gives you superpowers and wisdom beyond compare... Apparently the wisest king to have ever lived had a yearly tithe of 666 talents of gold...

Gold certainly has its mystique - throughout history people have coveted it as a source of wealth, magic, power etc.




Personally speaking, however - gold is by far the best anti-depressant on the market.

Open up a safe/attache case with gold in it, and you get that 'pulp fiction' effect:
pulp+fiction.jpg
 
A large reason gold is valuable is that it out of anything on earth it can take the most punishment and still keep it's form as gold. You just can't destroy the stuff.
 
"If you have/are privy to the method, you can burn it and grind it up into a powder, it gives you superpowers and wisdom beyond compare..."

it is not for the uninitiated - but that is why when it is done so, it hath been referred to as the "righteous teacher"
 
systematic said:
"If you have/are privy to the method, you can burn it and grind it up into a powder, it gives you superpowers and wisdom beyond compare..."

it is not for the uninitiated - but that is why when it is done so, it hath been referred to as the "righteous teacher"
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How to differentiate powdered gold and powdered piss?
 
jpanggy said:
systematic said:
"If you have/are privy to the method, you can burn it and grind it up into a powder, it gives you superpowers and wisdom beyond compare..."

it is not for the uninitiated - but that is why when it is done so, it hath been referred to as the "righteous teacher"
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How to differentiate powdered gold and powdered piss?
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you should be able to tell the difference ... get back to us and let us know how you "went"
 
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